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From the FTC Press Release about a Telemarketing Fraud

The Federal Trade Commission has successfully settled the second of 13 complaints brought as part of the multi-agency "Operation Tele-PHONEY" law enforcement sweep in May 2008 against deceptive telemarketers and the companies they operated throughout the United States.

In the settlement announced today, defendant Robert James Fischbach, who allegedly deceptively marketed advance-fee credit cards to consumers nationwide, has been prohibited from making the misrepresentations alleged in the complaint, and more broadly from violating the FTC Act and Telemarketing Sales Rule (TSR).

The order also imposes a monetary judgment of more than $2.4 million, most of which has been suspended due to his inability to pay.

The FTC sued Fischbach and his two companies, Integrity Financial Enterprises, LLC, also doing business as (d/b/a) Infinite Financial and National Benefit Exchange; and National Benefit Exchange, Inc.

According to the Commission's complaint, defendant Fischbach and his companies, all based in Florida, used telemarketing to sell an advance-fee "credit card" that they claimed could be used like a Visa or MasterCard, but which actually could be used only to buy products from the defendants' Web site or catalog.

The defendants charged consumers who accepted the cards an up-front fee of between $200 and $300, and promised them they would receive a credit card with a credit limit of $2,500 to $7,500, as well as a $1,000 cash advance limit.

The defendants also misled consumers into believing that they would honor consumers' requests to cancel or change their orders to avoid the debiting of the advance fee from their bank accounts, but they never did so.

The court granted the Commission's request for a temporary restraining order and asset freeze against Fischbach and the corporate defendants on May 13, 2008.

The court also entered a stipulated preliminary injunction order against Fischbach and the corporate defendants on May 28, 2008.

The final court order entered against Fischbach contains both conduct and monetary relief.

First, it permanently prohibits him from making any of the misrepresentations alleged in the complaint, including that consumers are being provided with a general-purpose credit card, that they can cancel their orders before their accounts are debited, and that such cancellation requests will be honored.

More generally, the order prohibits Fischbach from making misrepresentations about any good or service, prohibits him from violating the TSR, prohibits him from selling any of his customer lists, requires him to cooperate with the FTC, and includes monitoring provisions to ensure his compliance with the terms of the order.

The order also contains a $2,461,574 judgment against Fischbach, representing the total amount of harm his illegal conduct caused consumers. Almost all of the judgment has been suspended based on his inability to pay, but Fischbach must surrender his rights to several thousand dollars of assets already frozen by the court.

In addition, the full amount of the judgment will become due if Fischbach is later found to have misrepresented his or his companies' financial condition to the FTC.